Ned Company reported the following information for its fiscal year: The preferred dividends listed above include the current year and prior accumulated dividends. What is the amount of net income available to common shareholders?

Question

Ned Company reported the following information for its fiscal year:  The preferred dividends listed above include the current year and prior accumulated dividends. What is the amount of net income available to common shareholders?

Quizplus · Accepted Answer

Net income available to common shareholders can be calculated as follows:
Net Income - Preferred Dividends
= $510,000 - ($15,000 + $6,000)
= $489,000
Therefore, the amount of net income available to common shareholders is $489,000. The closest option is D ($490,000).

Ned Company Reported the Following Information for Its Fiscal Year